Offering strategy of a price-maker energy storage system in day-ahead and balancing markets

Niklas Peter René Erich Vespermann, Stefanos Delikaraoglou, Pierre Pinson

Research output: Chapter in Book/Report/Conference proceedingArticle in proceedingsResearchpeer-review


Energy storage systems (ESS) are considered as a promising solution to improve power system flexibility and facilitate the integration of renewables in electricity markets. This paper investigates the impact of strategic offering by an ESS operator in the day-ahead and balancing market. The offering strategy of a price-maker ESS operator is formulated as a bilevel model, where the upper-level problem represents the profit maximization of the ESS operator and the lower-level problem simulates the market-clearing outcome. This methodological framework can be used either to assess market efficiency distortion or as a trading strategy from the perspective of the ESS operator. Our analysis shows that adopting strategic behavior may improve ESS expected profit but reduces social welfare, especially for high ESS energy-to-power ratios.
Original languageEnglish
Title of host publicationProceedings of 2017 IEEE Manchester PowerTech
Number of pages6
Publication date2017
Pages6 pp.
ISBN (Print)9781509042371
Publication statusPublished - 2017
Event12th IEEE Power and Energy Society PowerTech Conference: Towards and Beyond Sustainable Energy Systems - University Place, University of Manchester., Manchester, United Kingdom
Duration: 18 Jun 201722 Jun 2017


Conference12th IEEE Power and Energy Society PowerTech Conference
LocationUniversity Place, University of Manchester.
CountryUnited Kingdom


  • Power system management, operation and economics
  • Optimisation techniques
  • energy storage
  • optimisation
  • power markets
  • pricing
  • State of charge
  • Wind forecasting
  • Energy storage
  • Electricity supply industry


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